Canadian Telco Quarterly Earnings Roundup

by Istvan Fekete on August 9, 2013

The numbers are in: several Canadian wireless players have published their second-quarter results, and I have to admit the numbers are impressive.
Let’s start with Wind Mobile. The struggling wireless carrier has gained almost 19,000 new subscribers, so it now has a user base of 620,000 customers, up 36% compared to a year ago. Furthermore, the company’s average revenue per user is up 2% at $27.90.

Moving to the incumbents, Bell was on the losing side, but only in terms of prepaid customers: it lost 52,000 subscribers, but gained almost 97,000 postpaid customers, which brings its total wireless customer base up to 7.7 million. According to the company’s quarterly earnings report, its blended ARPU (Average Revenue per User) is up 3%, reaching $56.85. Well, that’s more than double Wind Mobile’s.

Canada’s No. 2 wireless player, Telus, has also posted an impressive second quarter: the company gained 100,000 postpaid wireless subscribers. Bell and Telus are just a couple of thousands of subscribers away from each other, so they are fighting hard for the second place Telus gained during the first quarter of 2013. Telus’s blended ARPU is even higher than Bell’s, as it stands at $61.

Rogers, on the other hand, maintained its No. 1 position in the market, expanding its customer base by 98,000 wireless postpaid subscribers. Its revenue grew 3% during the second quarter, and its blended ARPU currently stands at $67.36.

But what’s interesting is the result of the rapid smartphone and tablet adoption, as well as the demand for high-speed Internet. As the quarterly earnings show, wireless data accounts for a huge chunk of the wireless player’s revenue — Bell 40% , Telus 43%, Rogers 46% — and it has grown 17% on average, and there’s no reason to suggest that this trend will be coming to end anytime soon.

A deep-pocketed new entrant such as Verizon could threaten the incumbent’s revenue stream, so their outrage at Ottawa’s policy is understandable. With the valuable 700 MHz spectrum allowing better quality services and higher range, Verizon’s bid for two blocks of spectrum could reach deep into the incumbent’s pockets.

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Written by: Istvan Fekete. Follow by: RSS, Twitter, Facebook, or YouTube.

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